The Law Office of Lynnette Ariathurai A Professional Corporation

Contract dispute between HP and Oracle to proceed to jury soon

A contract dispute between Hewlett-Packard and Oracle that began when Oracle decided to stop developing future software for HP's Itanium product is gearing up to enter the jury trial phase early next year. That is when the contract dispute will be heard in front of a California jury that will determine whether or not a breach of contract actually took place. If they determine that Oracle did breach its contract with HP, the jury will also decide how much in damages will be owed.

Back in August, a judge confirmed that a contract did exist between the two, one which meant that Oracle did need to continue developing software for Itanium servers. Oracle recently announced that it would keep developing software for Itanium-based servers until such time as HP ceased the sale of such servers. Despite the fact that the judge did rule that a binding contract existed between the two, a jury will have to decide whether an actual breach of contract took place and decide the exact amount of any damages that will have to be paid.

The lawsuit started in June 2011, when HP sued Oracle after the company's March 2011 announcement it would no longer write versions for new Itanium software releases. Oracle then countersued the other company, making the claim that HP was phasing out Itanium without revealing that particular bit of news. As the case ensued, a history of disputes between the two companies came to light. The companies apparently tried to end the period of conflict after former HP CEO Mark Hurd moved to Oracle. They signed an agreement where Oracle reportedly agreed to continue porting new software for the Itanium servers.

The trial to determine whether the contract dispute rose to an actual breach of contract is set to go before a California jury in February 2013. While it's impossible to say what the jury will ultimately decide, the fact that a judge has already determined that a valid contract existed between the two companies could weigh in HP's favor. The trial should be an interesting one to follow, especially for businesses which may be going through a similar contract dispute and pondering whether or not to file a breach of contract lawsuit.

Source:, "Jury to Hear HP-Oracle Itanium Case in February," Stephen Lawson, Sept. 11, 2012

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